Supply Chain Process Improvement

Looking farther into new world of services

Discover more on how we help businesses design and implement tactical functional improvements as described in the sections below:

Suppliers

Sourcing Strategy

Ensuring that a business is getting the best value from its suppliers is a key element of maximising profits. The sourcing strategy that is employed will often need to vary by category, balancing the purchase price against quality and service. Different drivers need to be evaluated for direct materials, goods for resale and indirect goods and services.

ASCC works with businesses to set the appropriate sourcing strategy by category and then select the most suitable supplier(s) through a rigorous strategic sourcing process based on total cost of ownership. This often involves challenging preconceptions of the drivers of demand, in addition to looking at the key supply requirements.

E-Procurement

After the initial hype, e-Procurement has matured and is now delivering benefits to businesses. However, the adoption of appropriate internet based technology can be a very complex task. These technologies include online auctions, e-RFX, e-Procurement, e-catalogues and online marketplaces, ranging through a whole range of tools for both direct and indirect goods and services.

We help businesses to select the most suitable technologies for their requirements from a completely independent viewpoint. We are committed to working with businesses to determine the benefits from any new technology prior to recommending any new processes or systems.

Supplier Management

In many businesses, supplier management is overlooked. Constantly focusing on the relationship with key suppliers, underpinned by suitable performance management metrics, leads to long and mutually beneficial relationships. Additionally, supplier management needs to be constantly developing processes, systems, quality and products to ensure the aims of the businesses are met.

We help businesses to constantly build and develop their relationships with suppliers through supplier management programmes. They focus on the key requirements of the business, ranging from supplier assessment, cost reduction, quality improvement, process development through to new product collaboration.

Factory Gate Pricing

Retailers, particularly multiples, collect products from suppliers' factories or warehouses and negotiate a discount on the previously-delivered price for the products. This is a traditional practice that has recently become known as 'factory gate pricing'. The premise is that the collection by the retailer is a cheaper supply chain option than delivery by the supplier.

This can often be true, but equally it can prejudice the supplier's distribution for its other customers. The key to FGP is to fully understand the supply chain costs on a customer by customer basis. Armed with this information, an appropriate solution can be designed. We help clients understand this level of cost breakdown and work out the implications of FGP.

Factories

Production Run Strategy

Every production unit must decide how to manage the production process as efficiently and reliably as possible, and address manufacturing execution, warehouse and inventory management. We use our experience in this area to help clients improve the efficiency of their production operations, increase product quality, and raise manufacturing yields. Our team can also help:

ASCC focuses on improving the way organisations interface with trading partners. We manage broad issues around strategy and operations across functional areas such as inbound and outbound transportation, physical distribution and third party logistics. We can help achieve significant efficiencies in transportation of materials and help create links between buyers and trading partners and between buyers' facilities, no matter where they are located.

Contract Manufacturing

Contract Manufacturing involves the outsourcing of a specific part of a manufacturing or assembly process to a third party or to a different operation within the same organisation.

Contract manufacturers can offer lower costs through economies of scale, providing services from less expensive geographies, offering design for manufacture capabilities, optimising logistics and achieving purchasing economies of scale on materials. There are many criteria and factors that need to be evaluated when making outsourcing decisions (cost reductions and cost savings are not the only criteria). Increasingly organisations are looking to utilise contract manufactures to speed up the time to market for new products and building increased flexibility into the Supply Chain to better manage demand fluctuations.

ASCC helps identify opportunities for cost reduction, quality improvement and increased flexibility through contract manufacturers; both internally and with a third party. Our team offers support through the tendering process, assessment and decision making and the subsequent ongoing management of the relationship and integration of the contract manufacture into the Supply Chain.

Capacity Management & Asset Utilisation

How should the production and distribution infrastructure be managed? Should a business invest in excess capacity and flex operations to match demand? Or should it run a steady production plan and spread demand over a longer period of time, thereby stock-building? Is outsourcing for contract suppliers at peak season appropriate? How can managers keep a medium term view on forthcoming production loads so that shift patterns can be flexed to accommodate?

We help companies assess their asset utilisation options.

Operational Effectiveness

Regardless of whether a business has designed its supply chain to be efficient or responsive, each element of the chain must perform at the optimal level and with sufficient reliability. It must have the best possible plan, and it must conform to it.

Customers feel variation, not averages.

Efficiency & Reliability in Manufacturing

Improving operational effectiveness in a manufacturing environment means managing costs and inefficiencies out of the process, whilst simultaneously improving the process reliability. We help businesses to reduce costs and gain control over production processes, so that businesses can plan effectively and deliver according to their promises.

Warehouses

Stock Control & Obsolescence

A fundamental warehousing and storage process which forms part of the overall supply chain inventory management philosophy. Management of inventory in the warehouse requires strict control of rotation, positioning and movement of stock, discipline in identifying and recording products and frequent management of exceptions.

Our staff help clients design the stock control rules, configure systems, identify and eliminate excess and obsolete inventory, and translate the overall inventory philosophy into the warehouse stock control rules. We have first hand experience of correcting operations that have suffered through poor stock processes and integrity.

Service Level Definition

The contractual description of service between a supplier and customer, including internal suppliers and customers, such as distribution centres and retail stores, for example. The contract covers the timeliness, quality, quantity and accuracy of the delivery. The service level definition is dictated by the service the business wants its supply chain to provide for its customers.

We have worked with a number of clients to define service levels and design a supply chain to ensure these are met.

Outsourcing Logistics

There are two major elements to an outsourcing process and one fundamental rule. The elements are choosing a partner/contractor and working out what you want to outsource and what must be kept in-house. The fundamental rule is that you cannot outsource responsibility. When responsibility is outsourced, the contractor sets the agenda and designs the service levels, and the client no longer has the skills nor knowledge to intervene.

We have assisted clients in specifying their requirements, tendering and selecting outsource partners, designing contract measurement and KPI tools, and renegotiating with contractors.

Operational Effectiveness

Regardless of whether a business has designed its supply chain to be efficient or responsive, each element of the chain must perform at the optimal level and with sufficient reliability. It must have the best possible plan, and it must conform to it.

Customers feel variation, not averages.

Efficiency & Reliability

We help our clients to ensure that warehouse operations meet the service and quality standards required by customers and the business, while maintaining control of costs. The fundamental issues to address are maximising use of the building, staff and equipment, integrity of the process and inventory, and flexibility. Previously our consultants have assisted clients with building and site layouts for DCs and warehouses, selection and configuration of MHE and storage equipment, design of shifts, operations processes and control procedures, and regaining control once one or all of these aspects of the operation have been compromised.

Distribution

Transport Management

Transport is a significant cost to business that requires specific skills to manage. But it is a mistake to focus on transport cost to the exclusion of wider supply chain cost and opportunities to drive competitive advantage.

Companies face three inter-related transport tradeoffs; outsourced Vs in-house, modal options, and cost Vs service. We help clients find and maintain the optimum balance between the competing factors by exploiting our consultants' real-world and consulting experience of transport management, working at operational, tactical and strategic levels.

Capacity Management

A key measure for any distribution operation is utilisation of assets, with the trade-off against this being the service level offered to the customer. Capacity management helps to set and maintain this strategic balance.

We have helped clients to plan the distribution assets required, schedule vehicles and staff, and devise operational strategies to cope with seasonality and growth as part of maintaining the right distribution capacity at an appropriate cost.

Routing & Scheduling

This involves the management of vehicles and staff on a tactical basis to balance running cost with service demands. The frequency of scheduling can vary from once a month up to many times a day, depending on the industry. Numerous software and tracking systems exist to carry out this task.

We do not offer any routing or scheduling software, but we help businesses to optimise the use of their existing packages. We also design and implement the service level agreements and key performance indicators that are required as design parameters for the scheduling systems.

Home Delivery

Business to consumer trading looks attractive, but the home delivery channel has a very different nature to the regular business to business channel. Because it interfaces with the ultimate consumer, it generates many more queries, complaints, missed deliveries and returns, which create an explosion in internal communications. The home delivery channel needs to have a completely different set of processes and management compared to business to business.

We help clients to design their customer offering, and then implement the supporting processes for warehousing, delivery & call centres. We also support the selection process to find the appropriate logistics partners.

Channels

Product Availability

Product availability is a key measure of both internal and external performance. Customers demand to receive their ordered products on time and in full. For retailers, empty shelves mean lost sales and disgruntled customers. For e-tailers, failure to deliver promises loses a customer forever. In a competitive marketplace, poor availability means that customers will go elsewhere.

Product availability is influenced by several elements, including stock levels throughout the supply chain, reorder algorithms, planning and forecasting, reliability and general management capability.

ASCC has worked with many companies to improve their availability levels, taking both 'point solution' views to fix immediate, operation-critical problems and wider, more inclusive perspectives to take into account the effect each element in the supply chain has on each other.

Back Door Operations - "the last 5 yards"

Retailers have become increasingly aware of the disproportionate cost of back door operations within stores. Receiving and unloading vehicles, identifying products, storing products, moving products to the sales floor, unpacking, stacking and returning packaging all represent significant costs to a business. As a result, much of the work traditionally carried out in store is being pushed back to the DC.

We help retailers to identify the back door operation costs and develop business cases for distribution streamlining and the linking of the DCs to the stores. These include the design of new processes and supporting infrastructures, which we then help to implement.

Obsolescence

Obsolescence can be a frustrating drain on the resources of organisations, with a number of industries citing it as contributing to 10-15% of their supply chain costs. Many companies have a strong focus on making accurate provision for it, but focus more of their attention on controlling inventory levels and maintaining availability. Fast, accurate and flexible supply chain planning can enable you to develop systems and tools which help reduce both inventory and obsolescence without impact on availability and customer service.

As part of the planning process, we help our clients develop a clear obsolescence process and policy. This allows not only accurate provision, but visibility, control and reduction of write-off, through to innovative strategies for disposal of obsolete stock.

Service Level Management

All too often, across a range of disciplines, the Service Level Agreement (SLA), or similar contract struck with a service provider, is nothing more than a document used to formalise the end of the sourcing process. From a business perspective though, much of the performance and customer service is driven by the delivery of external providers and suppliers.

The ability to rate, rank, differentiate and review your partners can be used in a multitude of ways, from strengthening understanding and relationships to supporting future decision making.

Across supply chain management and procurement disciplines, we use our significant experience in end-to-end service level management, enabling our clients to better control external factors and gain a deeper understanding of the key issues in their supply chain.

Internet and Home Shopping

The backdrop to e-commerce is changing at a dizzying pace, with developments in mobile commerce, advertising, digital delivery, Web 2.0 and the resulting legislation and its enforcement. Much time and focus has, understandably, been invested in these areas over the last decade. An organisation's ability to take advantage of non-traditional channels can be critical to maintaining market share, driving customer satisfaction and satisfying stakeholders.

Whether you're looking to review and modify your supply chain to take advantage of new channels, or to optimise your strategy to drive the advantage gained from them, we have significant experience in supporting clients in design and delivery of internet and alternative routes to market.

Consumer

Sale Returns

Consumer returns is a more critical matter than it is often given credit for. As well as operating a policy that is within current consumer legislation and recognising the rights of customers, organisations must create processes and infrastructure which allow for the logistics that support the policy.

With many organisations now aiming to integrate customer returns and customer support, reverse logistics has become a critical component of supply chain management. Many companies are unclear in the area, from customer feedback and cost, through to contingency planning and recall strategies.

Whether you're looking to measure, assess and understand the returns suffered by your business, understand the cost and means of disposal available or simply formalise your way of working as a clear, lucid policy, we have significant experience in supporting the integration of returns processes into supply chains.

Service level expectations by sector

Understanding the level of service your customers expect may seem like the foundation stone of any successful retailer or service provider. Often, however, regardless of the executive vision of an organisation, the service model and processes in a company's supply chain can make service level delivery, and hence the customer experience, an unpredictable one.

Most modern consumer markets are crowded, competitive arenas, often with large conglomerates not affected by the perceived barriers to entry or emerging channels obfuscating market forces. There has never been a more important time to match the service level targets for your offering to the changing needs of your customers.

ASCC's breadth of experience across a wide range of sectors, along with a wealth of supporting best practice and industry material, give us the perfect platform to guide clients on consumer expectations, from reviewing target service levels to assessing the cost of entering new market sectors.